8.59 Calculating and interpreting materials and labor flexible budget variances (LO2, LO3). SpringFresh provides commercial laundry and linen services to local hospitals, hotels, and restaurants. SpringFresh charges its customers $1.50 per pound laundered, regard- less of the items to be cleaned (e.g., sheet, towel, garment, tablecloth). SpringFresh budgets to launder 70,000 pounds each month and, for each pound laundered, budgets to spend $0.10 on materials and $0.40 cents on labor. For the most recent month, Spring Fresh actually laundered 60,000 pounds and spent $5,000 on ma- terials and $20,000 on labor. Required: a. What are the materials and labor-related flexible budget variances for the most re- cent month? b. In the absence of any other information, does it appear that Spring Fresh's manage- ment has done a good job controlling costs in the most recent month? c. Assume that in recent months, SpringFresh has received numerous complaints about the quality of their services. Specifically, several customers have complained that their laundry is not as clean as it used to be" and, even worse, that some of their items have come back stained. Does this information cast the favorable variances and management's performance in a different light